Kids pocket money down 30% from 2005 peak

Saturday, 08 September 2012 12:22

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The Halifax has published its 25th anniversary pocket money survey, the most detailed analysis of the spending habits of eight to15-year-olds.

The median amount received by children in the age group in 2012 fell to £5.98 from £6.25 in 2011 with the gap growing between what boys and girls receive.

In 2012, boys received on average of £6.16 a week, compared to £5.79 for girls, a difference of 37p.

In 2011, the gap between what boys and girls received was just 32 pence. It had reduced from a gap of 40 pence in 2010, which also saw children receive a seven-year low median amount of pocket money, just £5.89 a week.

The fall in pocket money in 2012 reflects the heightened financial pressure that households remain under with the biggest squeeze on income since the great depression of the 1930’s.

Pocket money values have been falling since the peak of 2005, when the average was £8.37 a week.

The number of children in the age group who actually receive any pocket money has fallen from 83 per cent to just 77 per cent.

Surprisingly, there are wide regional variations in the trend of pocket money values seen in the past year. In the north-east, there has been a 22 per cent rise in pocket money values, up to £7.12 per week from £5.84. This is despite the region having one of the highest proportions of workless households in the UK.

By contrast, children in the East Midlands have experienced a 21 per cent fall in pocket money, down to £4.44 from £5.62 a week. Children in Yorkshire and Humberside have also seen an 18 per cent decrease in the past 12 months.

Perhaps unsurprisingly, children in London receive the highest amount of pocket money, down four per cent on 2011 to an average of £7.34 a week. 

The report tries to put the amount received in comparison to prices in a context that children can understand.

In 1987, when the survey started, Cadbury Twirl chocolate bars cost 22p each and kids could buy on average five bars a week. Now, Twirl bars cost about 60p and children can now buy ten per week.

Two-thirds of children save at least 25 per cent of their pocket money, whilst 40 per cent keep their pocket money in a bank or building society.

Richard Fearon, Head of Halifax Savings says: "It is encouraging to see that over two thirds of children are still saving at least a quarter of the money they get despite the fact that amount of pocket money they receive has fallen.

“Pocket money is often the first opportunity children have to manage money and it gives them valuable insight into the benefits of both short and long term saving."

Children seem quite happy with the amount they receive. 48 per cent think they get the right amount, while 43 per cent of children think they should get more.

In general, the amount of pocket money rises with age. The average eight-year old gets £4.20 a week, rising to £5.78 by the age of 11 and up to £8.17 by the age of 15.

 

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